Samsung to Slash OLED Production as iPhone X Production Disappoints: Nikkei [u]

Samsung Electronics will slash output of its organic light-emitting diode (OLED) panels after Apple cut production of iPhone X amid weak demand, claims a new report from the Far East.


According to a new report from Nikkei Asian Review, Samsung Display, the panel-making unit of Samsung Electronics, now plans to make OLED panels for 20 million or fewer iPhones at the South Chungcheong plant in the January-March quarter. This number is significantly lower than its initial goal of supplying panels for 45 million to 50 million iPhones during the same quarter.

Samsung has yet to determine its production schedule for the April-June period, but one can only assume that further cutbacks are in store for the South Korean company.

This new target for Samsung Display reduces productions to around 60% of the original plan, and when comparing facilities dedicated to making display panels for Apple, this rate will fall to 50% or lower.

In order to offset the financial impact that this drastic reduction in production will lead to, Samsung is currently trying to secure orders from more customers in China.

Last year, Samsung invested $12.6 billion USD to boost its OLED production capacity in anticipation of an iPhone X boom that never came. Early predictions for 2018 profits were to beat the 6-year high of Q2 last year, but now it’s looking like Samsung’s display business may be in for a slump.

Apple will halve its iPhone X production target for the first three months of the year to around 20 million units, we reported last month, adding to growing concerns about weak sales of the flagship smartphone.